Tecnoglass(TGLS) - 2025 Q1 - Quarterly Results

Q1 2025 Financial Highlights Q1 2025 Key Performance Indicators | Metric | Q1 2025 | YoY Change | | :--- | :--- | :--- | | Total Revenue | $222.3 Million | +15.4% | | Single-Family Residential Revenue | $88.9 Million | +21.6% | | Gross Margin | 43.9% | +510 bps | | Net Income | $42.2 Million | - | | Diluted EPS | $0.90 | - | | Adjusted Net Income | $43.1 Million | - | | Adjusted Diluted EPS | $0.92 | - | | Adjusted EBITDA | $70.2 Million | +37.5% | | Adjusted EBITDA Margin | 31.6% | - | | Free Cash Flow | $28.8 Million | - | | Cash Position | $157.3 Million | All-Time High | | Backlog | $1.14 Billion | +24.9% | Management Commentary - CEO José Manuel Daes highlighted the exceptional start to 2025, with double-digit growth across both residential and commercial businesses, outperforming macroeconomic trends. The acquisition of Continental Glass Systems is seen as a key move to enhance U.S. manufacturing capabilities and growth opportunities[3] - COO Christian Daes emphasized strong demand for high-performance products, driving share gains in the single-family residential business. He noted that the record $1.14 billion backlog provides visibility through 2026 and that the company has taken decisive steps to mitigate the impact of aluminum tariffs through pricing and supply chain adjustments[3] Q1 2025 Financial Performance Revenue Analysis Total revenues for Q1 2025 grew 15.4% year-over-year to a record $222.3 million. This growth was entirely organic, driven by strong performance in both the multi-family/commercial segment, which grew 11.6%, and the single-family residential segment, which saw a significant 21.6% increase due to market share gains and geographic expansion Q1 2025 Revenue Breakdown | Segment | Q1 2025 Revenue | YoY Growth | | :--- | :--- | :--- | | Total Revenue | $222.3 Million | 15.4% | | Multi-family/Commercial | - | 11.6% | | Single-family Residential | $88.9 Million | 21.6% | - Changes in foreign currency exchange rates had a minor positive impact, contributing $0.8 million to total revenues[4] Profitability Analysis Gross margin expanded significantly by 510 basis points to 43.9%, driven by stronger pricing, stable raw material costs, and operating leverage. Net income was $42.2 million ($0.90/share), and Adjusted EBITDA increased 37.5% to $70.2 million, yielding a 31.6% margin. SG&A expenses rose to 19.1% of revenue, partly due to higher transportation costs and $4.7 million in tariff expenses, which the company expects to mitigate in future quarters Q1 2025 vs Q1 2024 Profitability | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Gross Profit | $97.5 Million | $74.7 Million | | Gross Margin | 43.9% | 38.8% | | Net Income | $42.2 Million | $29.7 Million | | Diluted EPS | $0.90 | $0.63 | | Adjusted Net Income | $43.1 Million | $30.9 Million | | Adjusted Diluted EPS | $0.92 | $0.66 | | Adjusted EBITDA | $70.2 Million | $51.0 Million | | Adjusted EBITDA Margin | 31.6% | 26.5% | - SG&A increased to $42.5 million (19.1% of revenue) from $33.6 million (17.5% of revenue) in the prior year, primarily due to higher transport/commission costs, salary adjustments, and $4.7 million in tariff expenses[6] Cash Generation, Capital Allocation and Liquidity The company demonstrated strong financial health, generating $46.9 million in cash from operations and achieving a record cash position of $157.3 million. Total liquidity stood at approximately $330 million. During the quarter, Tecnoglass returned $7.0 million to shareholders through dividends and has $76.5 million remaining under its share repurchase program Q1 2025 Liquidity and Cash Flow | Metric | Amount | | :--- | :--- | | Cash from Operating Activities | $46.9 Million | | Capital Expenditures | $18.1 Million | | Free Cash Flow | $28.8 Million | | Cash and Cash Equivalents (End of Q1) | $157.3 Million | | Total Liquidity | ~$330 Million | | Total Debt | $109.0 Million | - The company paid $7.0 million in cash dividends during the quarter[11] - As of May 8, 2025, approximately $76.5 million remains available under the current share repurchase authorization[11] Strategic Developments Asset Acquisition In April 2025, Tecnoglass acquired certain assets of Florida-based Continental Glass Systems for approximately $30 million. This strategic move includes a manufacturing plant and a substantial project backlog. The acquisition is expected to add about $30 million in annualized revenues, expand Tecnoglass's U.S. manufacturing footprint, and create operational synergies - Acquired certain assets of Continental Glass Systems, a Florida-based provider of architectural glass and glazing solutions[2][13] - The purchase price was approximately $30 million and included a manufacturing plant, intangibles, and a project backlog[13] - Continental has annualized revenues of approximately $30 million and is expected to strengthen Tecnoglass's U.S. market presence and create synergies[13] U.S. Manufacturing Expansion In a significant strategic initiative, Tecnoglass has launched a feasibility analysis to develop automated manufacturing capabilities within the United States. This move aims to diversify its production base beyond its primary facilities in Colombia - The company has initiated a feasibility analysis to potentially develop automated manufacturing capabilities in the U.S. in the coming years[2] Full Year 2025 Outlook Based on the strong Q1 performance, Tecnoglass has updated its full-year 2025 guidance. The company raised the low end of its revenue forecast and narrowed its Adjusted EBITDA range. The outlook anticipates approximately 11% revenue growth and 15% Adjusted EBITDA growth at the midpoints, incorporating an estimated $25 million impact from tariffs, which is expected to be offset by pricing actions and other countermeasures Updated Full Year 2025 Guidance | Metric | FY 2025 Outlook Range | Midpoint Growth | | :--- | :--- | :--- | | Revenue | $960M - $1.02B | ~11% | | Adjusted EBITDA | $305M - $330M | ~15% | - The outlook includes an estimated full-year impact of approximately $25 million from higher input costs and tariffs, prior to mitigation efforts[14] - The company believes planned pricing actions and other strategic initiatives will more than offset the impact of tariffs for the remainder of the year[14] Financial Statements Consolidated Balance Sheets As of March 31, 2025, total assets stood at $1.14 billion, an increase from $1.02 billion at the end of 2024. This was driven by increases in cash, trade accounts receivable, and inventories. Total liabilities rose to $453.2 million, while total shareholders' equity grew to $685.1 million Key Balance Sheet Items (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $157,302 | $134,882 | | Total current assets | $636,761 | $560,010 | | Total assets | $1,138,289 | $1,016,648 | | Total current liabilities | $329,079 | $265,826 | | Total liabilities | $453,152 | $385,465 | | Total shareholders' equity | $685,137 | $631,183 | Consolidated Statements of Operations For the first quarter of 2025, the company reported total operating revenues of $222.3 million, up from $192.6 million in the prior-year period. Gross profit increased to $97.5 million from $74.7 million. Net income saw a substantial rise to $42.2 million, or $0.90 per diluted share, compared to $29.7 million, or $0.63 per share, in Q1 2024 Q1 Statement of Operations Highlights (in thousands) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total operating revenues | $222,288 | $192,627 | | Gross profit | $97,525 | $74,660 | | Operating income | $59,329 | $41,022 | | Net income | $42,189 | $29,730 | | Diluted income per share | $0.90 | $0.63 | Consolidated Statements of Cash Flows In Q1 2025, net cash provided by operating activities was $46.9 million, a significant improvement from $33.4 million in Q1 2024, driven by higher net income. Net cash used in investing activities was $18.2 million, mainly for property and equipment acquisitions. Financing activities used $7.4 million, resulting in a net increase in cash of $22.4 million for the quarter Q1 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Cash Provided by Operating Activities | $46,898 | $33,447 | | Cash Used in Investing Activities | $(18,190) | $(10,192) | | Cash Used in Financing Activities | $(7,437) | $(16,686) | | Net Increase in Cash | $22,420 | $6,373 | Non-GAAP Reconciliations and Supplemental Data Revenues by Region The United States remains the company's primary market, contributing $212.5 million in revenue for Q1 2025, a 15.5% increase year-over-year. Colombia also showed strong growth of 22.4%, with revenues reaching $6.4 million. The U.S. accounted for approximately 95% of total revenues Q1 2025 Revenues by Region (in thousands) | Region | Q1 2025 Revenue | Q1 2024 Revenue | % Change | | :--- | :--- | :--- | :--- | | United States | $212,454 | $184,003 | 15.5% | | Colombia | $6,414 | $5,239 | 22.4% | | Other Countries | $3,421 | $3,385 | 1.0% | | Total | $222,288 | $192,627 | 15.4% | Reconciliation of Adjusted Net Income and Adjusted EBITDA For Q1 2025, Adjusted Net Income was $43.1 million ($0.92 per diluted share), up from $30.9 million ($0.66 per share) in Q1 2024. Adjusted EBITDA rose to $70.2 million from $51.0 million year-over-year. These non-GAAP measures exclude items such as foreign currency transaction losses, non-recurring expenses, and the tax impact of these adjustments to better reflect core operating performance Reconciliation to Adjusted Net Income and Adjusted EBITDA (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income | $42,189 | $29,730 | | Adjusted Net Income | $43,078 | $30,908 | | Diluted Adjusted Net Income per Share | $0.92 | $0.66 | | Adjusted EBITDA | $70,200 | $51,043 |